As conducting transactions over the Internet has become increasingly popular, the problems and challenges that arise for merchants have also increased. Online transactions create greater difficulty in determining which transactions are legitimate and which transactions are fraudulent. Stolen payment data may be used by a fraudster to purchase goods or services from a merchant. The use of stolen payment data may not be immediately detected by the merchant and may not be known until a significant time after the goods or services have been provided to the fraudster. Thus, the resulting fraud can cost the merchant significant amounts of money in the form of lost revenue and lost stock.
Some merchants take it upon themselves to manually review each and every order and expend significant time and resources in order to determine whether transactions are legitimate or fraudulent. As transaction volumes increase, this becomes an increasingly unsustainable model for merchants. As a result, merchants may find it necessary to incorporate an automated fraud detection system into their transaction processing system.
Some fraud detection systems can include fraud detection rules that evaluate transactions and assist merchants in deciding whether a specific transaction should be accepted or rejected.
However, even with sophisticated fraud detection systems in place, a merchant can still be compromised and be responsible for the costs of fraudulent transactions (e.g. the loss of goods and/or the loss of consideration for those goods). For example, a fraud detection rule may have been intentionally or accidentally modified so as to accept transactions that would ordinarily not be accepted or to misidentify transactions that should be rejected. The merchant may have no way of determining when a fraud rule was modified or who may have done the modification.
Further, new and enhanced methods of detecting fraud with greater merchant services have become increasingly necessary to provide greater security and functionality.
Embodiments of the invention address the above problems, and other problems, individually and collectively.